Britons see inflation rising, rate hike expectations muted: BoE
December 7, 2013, 12:08 am TWN
LONDON--British people expect inflation to pick up but are still largely heeding the message from Bank of England Governor Mark Carney that interest rates will not go up any time soon even as the economy recovers, a survey showed on Friday.
A quarterly poll commissioned by the BoE found the median expectation for inflation over the next 12 months rose to 3.6 percent from 3.2 percent in August.
Fewer people expected the BoE's record-low interest rates to remain unchanged over the coming year than they did in August, at 43 percent compared with 49 percent. However, the latest reading was still the second-highest since the survey began in 1999, the BoE said.
Thirty-four percent expected rates to rise, up from 29 percent three months ago but lower than the average of 52 percent in 2010 when economic growth was last as strong.
Carney took over the BoE in July and a month later the Bank said it would not consider raising interest rates until unemployment falls to 7 percent, an attempt to give households and businesses the confidence to spend and spur the recovery.